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[url= http://www.independent.co.uk/news/uk/crickhowell-welsh-town-moves-offshore-to-avoid-tax-on-local-business-a6728971.html ]http://www.independent.co.uk/news/uk/crickhowell-welsh-town-moves-offshore-to-avoid-tax-on-local-business-a6728971.html[/url]
Will be watching this when it airs - sounds like a great idea which might potentially make HMRC sit up & take notice. Couldn't work out from the article whether they'll actually be giving away their secrets or not - surely as many towns/businesses as possible copying them would be essential for the plan to succeed?
Sounds great.
I want to know how they bring the profits back onshore (I assume the business owners are not planning on moving to the IOM to spend their filthy lucre)
I want to know how they bring the profits back onshore
I imagine they maintain the separation of taxes on corporate profit and tax on private income. The latter being taxed on repatriation is the same as if you invested in Amazon shares and received a dividend from Amazon Inc (whereever it may be located).
The objective looks to be to minimise corporation tax by synthetically raising deductible expenses with offshore charges and funding costs (interest).
This is why corporation tax ought to have a subject to a floor as a ratio of turnover IMO.
This is why corporation tax ought to have a minimum deduction based on turnover IMO
Problem with that is a company can have huge turnover and quite genuinely make zero profit or even a loss. In my industry I know at least 3 companies who turnover £50m+ and make well under £500k gross profit without any questionable tax moves.
Anyway, I like what they're doing, either you'll see some independents making more money or the government will wake up, either way it's a good thing.
Problem with that is a company can have huge turnover and quite genuinely make zero profit or even a loss. In my industry I know at least 3 companies who turnover £50m+ and make well under £500k gross profit without any questionable tax moves.
no problem, the £500k is gone.
The floor would only be 1-2% of T/O
Genuine question - where does the £50m+ of turnover go? Materials, wages, rent, tax etc?
Problem with that is a company can have huge turnover and quite genuinely make zero profit or even a loss. In my industry I know at least 3 companies who turnover £50m+ and make well under £500k gross profit without any questionable tax moves.
+1, a floor would unfairly penalize small startup companies where the owners may be deliberately drawing small salaries/dividends and re-investing all profits into growth.
Genuine question - where does the £50m+ of turnover go? Materials, wages, rent, tax etc?
If you look at the financial trading a bank does they are over the moon to make 3 bp on a turn, i.e. 0.03%, turnover is a completely meaningless concept for banks.
The government will probably close the loophole that stops a whole town doing it but big businesses can carry on....
Don't understand this at all.
I know for a fact that HMRC and the Govt are closing the loopholes in this respect. Would like to see this get challenged, clearly if they win all that offshoring the Banks do is legal right?
Opens it all right out again...
I think the point is they're doing [i]exactly[/i] what big business are doing - what anyone could do if they had access to tax experts, etc.The government will probably close the loophole that stops a whole town doing it but big businesses can carry on....
Surely the point is that it [b]is[/b] legal - but unethical?Would like to see this get challenged, clearly if they win all that offshoring the Banks do is legal right?
You don't need tax experts to go offshore 😉
I know for a fact that HMRC and the Govt are closing the loopholes in this respect. Would like to see this get challenged, clearly if they win all that offshoring the Banks do is legal right?
EU rules, little the UK Govt can do about it.
Want to change it, vote to leave in the referendum!
EU rules, little the UK Govt can do about it.
It is not just EU rules, it is a mixture of a lot of things including domestic legislation, double tax conventions and EU law (which will typically has been implemented into Domestic Legislation). Simply leaving the EU wouldn't help especially for planning for the Isle of Man which wouldn't be covered any way.